Accounting › Section E · Merchandising transactions › Topic E.4
Recording sales, returns, and discounts
A sale is rarely the end of the story: customers send goods back, ask for price cuts on damaged items and pay early to earn a discount. Recording each step properly turns gross sales into the net sales figure a merchandiser actually keeps.
In this topic
- Two entries for every sale
- Contra-revenue accounts
- Worked example: a credit sale
- Worked example: a return and an allowance
- Returned goods that cannot be resold
- Worked example: collecting within the discount period
- Sales tax is not revenue
- Estimating returns and discounts
- Common mistakes to avoid
- Key takeaways
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